Be among the first to pay less property tax this year

You may pay less property tax this year 


Local councils offer discounts from January 2016 of up to 20% in the IBI of homes and offices that use less energy. That is the news.


The Ministry of Finance has devised an energy reduction law on Property Tax (IBI) which offers discounts of up to 20% for households (and offices) more efficient on energy saving. 


Just a reminder about Energy Performance Certificate

The scale designed by the Ministry of Industry set seven levels, ranging from “A” (indicating more efficient) to “G” (least efficient). To determine which letter it was assigned to a building, a complicates formula which has annual CO2 emissions and consumption levels in heating, cooling, hot water and lighting account is used. This calculation is done by a programme released by the Ministry where all the information about the home is introduced if everything is correct a certificate is produced with the rating.


The law determines that the energy rating is mandatory for new buildings, as well as properties on sell or for rent. Thus, a certificate must be presented to the buyer or lessee.


So what IBI you will be paid in 2016?

How is it possible to know if your home is among the lucky ones to apply this bonus? And how can a homeowner claim this reduction in IBI? In this article I analyse five important points to have in mind with regards to this new law.


The new tax reduction from the Ministry of Finance aims to encourage energy rehabilitation of buildings, promote the construction and purchase of energy-efficient homes, as well as performing installations or schemes for obtaining energy certificates. What are the reductions and how it affects property owners? The main keys to the property tax rebate to efficient houses are explained here.


What is the property tax rebate?

The Government has amended the 2004 Local Finance law, so that allows councils to lower the real estate tax to homes and offices more energy saving. The highest bonus is 20%, decreasing the rate to 4%, depending on the energy rating of the building.


When will come into force?

This bonus can be applied from January 1. However, it should be noted that this tax is the responsibility of local councils, so it is they who have the final word implementing the tax rebate through municipal by-laws.


How we can save on the IBI?

Not all property owners will save the same amount, as the by-laws will rewards the most environmentally conscious and more efficient homes. The reductions are gradual:

  • If the house is certified with the letter A of you Energy Proficiency Certificate (EPC), the rebate will be 20% in the IBI.
  • The one with a grade B, will receive a bonus of up to 16%.
  • If the rating is C, can reach 12%.
  • Households with the letter D on its energy certification will have a maximum rebate of 8%.
  • If you have just gotten the E qualification, the bonus is 4% of IBI.
  • Homes with letters F and G, or without a license, they may NOT request any rebate. 

What should I submit to obtain my discount?

To qualify for the rebate that applies to you, the property owner must prove that his house has an energy certificate and submit it to your local city hall. Not all homes have an energy certificate, as the current legislation only establishes an obligation to perform this test for new or used homes which have been offered for sale or rent.


What I can do at home to raise the level of efficiency?

According to statistics from energy certification prepared by the Ministry of Industry, only 0.1% of Spanish households with energy rating certificate is A. So they only benefit from a 20% reduction in property tax.


Discounts of 16% (B) and 12% (C) in the IBI: only 0.6% of taxpayers have a home with letter B and 3.4% with C. One in ten homes has been certified with the letter D, according to the records, and most of the houses, 46% may obtain a reduction of 4%, having the rating E.


But is it possible to improve the home efficiency "note"? The answer is yes, you can, but obviously you have to carry out some home improvement, and not many citizens will do that just not obtain a minimal reduction in the IBI.


It can compensate those who already plan to make reforms at home, because they can raise their rating by spending a little more than originally anticipated. If they improve the glassing when changing the windows (about 300 euros) and place a condensing boiler with a modulating thermostat (hovering around 400 euros both), a house with certificate “F” might jump to a “C” rating.


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